Market Overview

GoPro Captures Downgrade Ahead Of CES; Company Guides Lower, Cuts Workforce

GoPro Captures Downgrade Ahead Of CES; Company Guides Lower, Cuts Workforce

GoPro Inc (NASDAQ: GPRO) is reportedly looking to slash up to 300 jobs, mostly in its drone division. While this has yet to be confirmed, at least one notable analyst cautions investors to move to the sidelines.

The Analyst

Longbow Research's Joe Wittine downgraded GoPro's stock from Buy to Neutral.

The Thesis

After speaking with high level supply chain contacts that are familiar with GoPro's business, a negative pre-announcement from GoPro concerning its fourth quarter performance is expected, Wittine said in a note. Specifically, the conversations led the analyst to believe GoPro's holiday sales performance fell short of the company's plan. A $100 price cut benefited the HERO5 Black, but "not enough to save the quarter," according to Wittine. Inventory as of the end of 2017 isn't lean enough to generate a catalyst in the first quarter of 2018.

On the positive side, a new sub-$200 camera is slated for the second quarter and a revised KARMA outlook is expected in the bottom half of 2018.

Despite what appears to be a plethora of negative commentary, the case for owning GoPro's stock could be made " on the atypical product cycle and cost-outs driving upside to consensus," Wittine said.

Investors are cautioned to wait for the company's fourth quarter earnings report and first quarter 2018 guidance before. But ahead of GoPro's investor meeting at the CES event Tuesday, the analyst can't "recommend buying today with a straight face."

Price Action

Shares of GoPro were trading lower by more than 4.6 percent at $7.17 ahead of Monday's market open.

The stock was halted at 8:56 a.m. ET. Shortly after, the company reported preliminary Q4 sales of $340 million vs. $474 million estimates. The company also announced it will reduce its global workforce from 1,254 employees to fewer than 1,000.

Related Links:

2 Trends That Dominate The Ambarella Story

Sears, GoPro Top The Latest List Of Hot Stocks Among Short Sellers

Latest Ratings for GPRO

Mar 2020Morgan StanleyMaintainsUnderweight
Mar 2020CitigroupDowngradesNeutralSell
Oct 2019Morgan StanleyMaintainsUnderweight

View More Analyst Ratings for GPRO
View the Latest Analyst Ratings


Related Articles (GPRO)

View Comments and Join the Discussion!

Posted-In: CESAnalyst Color News Guidance Downgrades Events Top Stories Analyst Ratings Best of Benzinga

Need corporate guidance data?
Click here to see licensing options.

Latest Ratings

ICPTChardan CapitalInitiates Coverage On145.0
AWIEvercore ISI GroupUpgrades77.0
FBHSEvercore ISI GroupDowngrades41.0
IBPEvercore ISI GroupUpgrades45.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at